Odometer fraud is a serious crime that robs its victims of thousands of dollars in inflated costs for high-mileage vehicles. Even worse, it tends to target a population of low-income people who are the largest market for used cars and trucks. The victims might not even realize they were targeted by odometer fraud but secretly incur significantly higher repair costs that they would not have with a lower-mileage vehicle. The fact that most odometers are digital instead of mechanical has not slowed the problem down and, in many ways, have made committing fraud even easier.
“When the owner of a registered motor vehicle transfers his or her title or interest in that vehicle, the transferor shall present to the transferee before delivery of the vehicle, written disclosure of odometer mileage by means of the certificate of title or a written statement signed by the transferor”, which includes “[t]he odometer reading at the time of transfer”. MCL 257.233a(1)(a). The certificate of title MUST contain one of the following:
- “A statement by the transferor certifying that to the best of his or her knowledge the odometer reading reflects the actual mileage of the vehicle.” MCL 257.233a(1)(g)(i).
- “If the transferor knows that the odometer reading reflects the amount of mileage in excess of the designed mechanical odometer limit, a statement to that effect.” MCL 257.233a(1)(g)(ii).
- “If the transfer knows that the odometer reading differs from the mileage and the difference is greater than that caused by odometer calibration error, a statement that the odometer reading does not reflect the actual mileage and should not be relied upon. This notice shall include a warning notice to alert the transferee that a discrepancy exists between the odometer and the actual mileage.” MCL 257.233a(1)(g)(iii).
An odometer statement in the certificate of title is not required for any of the following:
- “Vehicles having a gross vehicle weight rating of more than 16,000 pounds.” MCL 257.233a(5)(a).
- “A vehicle that is not self-propelled.” MCL 257.233a(5)(b).
- “A vehicle that is 10 years old, or older.” MCL 257.233a(5)(c).
- “A new vehicle transferred from a manufacturer to a dealer.” MCL 257.233a(5)(d).
- “A vehicle sold directly by the manufacturer to an agency of the United States in conformity with contractual specifications.” MCL 257.233a(5)(e).
- “A low-speed vehicle.” MCL 257.233a(5)(f).
An odometer tamperer often must create a false title to hide the actual mileage of the vehicle. The original title is destroyed and a new duplicate title is requested from the Secretary of State to reflect the altered mileage figures. This recreated title may also feature a transfer from a fictitious seller or dealership to make it more difficult to trace the source of the altered mileage. To get away with odometer fraud, the fraudster is often committing several additional misdemeanors and felonies to pull this nefarious scheme off.
MCL 257.233a(6) criminalizes odometer fraud as follows:
- “A person shall not alter, set back, or disconnect an odometer; cause or allow an odometer to be altered, set back, or disconnected; or advertise for sale, sell, use, install, or cause or allow to be installed a device which causes an odometer to register other than the actual mileage driven. This subsection does not prohibit the service, repair, or replacement of an odometer if the mileage indicated on the odometer remains the same as before the service, repair, or replacement. If the odometer is incapable of registering the same mileage as before the service, repair, or replacement, the odometer shall be adjusted to read zero and a notice in writing shall be attached to the left door frame of the vehicle by the owner or his or her agent specifying the mileage prior to service, repair, or replacement of the odometer and the date on which it was serviced, repaired, or replaced. A person shall not remove, deface, or alter any notice affixed to a motor vehicle pursuant to this subsection.”
Any person who commits odometer fraud is guilty of a felony. MCL 257.233a(7). A conviction for odometer fraud is punishable by a fine between $500.00 and $5,000.00 or between 1 to 5 years of imprisonment, or both. MCL 257.902.
In addition, any person who makes a false or inaccurate statement of mileage on a certificate of title (contrary to MCL 257.233(1)) or commits odometer fraud (contrary to MCL 257.233(6)) “is liable in an amount equal to 3 times the amount of actual damages sustained or $1,500.00 whichever is greater, and in the case of a successful recovery of damages, the costs of the action together with reasonable attorney’s fees.” MCL 257.233a(15).
The prosecutor is not required to prove an “intent to defraud” by the seller or dealer when prosecuting someone for odometer fraud. People v Houseman, 128 Mich App 17, 22; 339 NW2d 666 (1983). The elements of the crime “could be accomplished through proof of the turning back of an odometer and the selling of the car at an inflated price”. Id. However, there is nothing that would prevent the prosecutor from filing charges for larceny by false pretenses if an “intent to defraud” can be proven. In fact, the criminal penalties can be higher depending on the amount of money that the victim was cheated out of due to the overpriced vehicle.
- A person who, with the intent to defraud or cheat makes or uses a false pretense to sell a vehicle that has a value of $1,000.00 or more but less than $20,000.00 is guilty of a felony punishable by a fine up to $10,000.00 or 3 times the value of the property, whichever is greater, or up to 5 years in prison, or both. MCL 750.218(4)(a).
- A person who, with the intent to defraud or cheat makes or uses a false pretense to sell a vehicle that has a value of $20,000.00 or more but less than $50,000.00 is guilty of a felony punishable by a fine up to $15,000.00 or 3 times the value of the property, whichever is greater, or up to 15 years in prison, or both. MCL 750.218(5)(a).
- A person who, with the intent to defraud or cheat makes or uses a false pretense to sell a vehicle that has a value of $50,000.00 or more but less than $100,000.00 is guilty of a felony punishable by a fine up to $25,000.00 or 3 times the value of the property, whichever is greater, or up to 15 years in prison, or both. MCL 750.218(6)(a).
- A person who, with the intent to defraud or cheat makes or uses a false pretense to sell a vehicle that has a value of $100,000.00 or more is guilty of a felony punishable by a fine up to $35,000.00 or 3 times the value of the property, whichever is greater, or up to 20 years in prison, or both. MCL 750.218(7)(a).
- The values of vehicles fraudulently sold with intent to defraud in a 12-month vehicle may be aggregated to determine the total value for prosecution under the larceny by false pretenses statute. MCL 750.218(8).
In addition to the state laws and penalties, anyone who tampers with an odometer and conveys a vehicle to someone in a different state will be subjected to prosecution under federal law.
- A person may not “advertise for sale, sell, use, install, or have installed, a device that makes an odometer of a motor vehicle register a mileage different from the mileage the vehicle was driven, as registered by the odometer within the designed tolerance of the manufacturer of the odometer.” 49 U.S.C. 32703(1).
- A person may not “disconnect, reset, alter, or have disconnected, reset, or altered, an odometer of a motor vehicle intending to change the mileage registered by the odometer.” 49 U.S.C. §32703(2).
- A person may not, “with intent to defraud, operate a motor vehicle on a street, road, or highway if the person knows that the odometer of the vehicle is disconnected or not operating.” 49 U.S.C. §32703(3).
- A person transferring ownership of a motor vehicle may not omit a disclosure or make a false statement regarding the actual odometer reading of the vehicle being transferred. 49 U.S.C. §32705(a)(2).
Anyone who violates any of these federal laws (or conspires with another person to violate these federal laws) is liable to the United States government for a civil penalty up to $10,000.00 for each violation up to an aggregated maximum of $1,000,000.00. 49 U.S.C. §32709(a)(1). In addition, a person can be liable for a felony conviction punishable by a fine or up to 3 years in prison, or both. 49 U.S.C. §32709(b).
Anyone who is convicted of odometer fraud should not expect any sympathy from the judge and may face substantial fines or imprisonment. You should not settle for anything less than the best criminal defense attorney in your corner. If you or a loved one is charged with any crime or needs legal representation, do not hesitate to contact the skilled lawyers at Kershaw, Vititoe & Jedinak PLC today.